Pacific Biomarkers, Inc. Reports Second Quarter Operating Results
SEATTLE, WA--(Marketwire - February 15, 2011) - Pacific Biomarkers, Inc. (OTCBB: PBMC), a leading provider of specialized biomarker and contract research services, today announced its operating results for the second quarter and first half of FY2011.
For the three months ended December 31, 2010 (the second quarter of FY2011), revenue increased 20% to $2,532,069, compared with $2,113,795 in the second quarter of FY2010. Operating loss was $202,728 in the second quarter of FY2011, versus an operating loss of $307,037 in the prior-year period. The Company reported net loss of $349,218, or $0.02 per share, for the three months ended December 31, 2010, compared with net loss of $457,629, or $0.03 per share, in the three months ended December 31, 2009.
Revenue for the six months ended December 31, 2010 increased 22% to $5,385,602, compared with $4,415,170 during the corresponding period of the previous fiscal year. Operating loss was $250,252 in the first half of FY2011, versus an operating loss of $520,745 in the same period last year. Net loss for the six months ended December 31, 2010 totaled $551,581, or $0.03 per share, compared with net income of $730,799, or $0.04 per share, for the comparable six-month period in FY2010.
"Our results for the three months ended December 31, 2010 are a reflection of the challenging drug development environment. While revenue increased from the prior year, gross profit was still short of plan. We remain confident that we are well positioned to execute our strategic plan for continued growth in the specialty laboratory and our biomarker services area," commented Ron Helm, Chief Executive Officer of Pacific Biomarkers. "We benefited from a large contract in the first two quarters, while other revenues reflected what we have seen in our clinical services market in line with what other Contract Research Organizations (CROs) have reported."
Mr. Helm continued, "The Company's result last year demonstrated that the drug development marketplace continues to challenge organizations supporting clinical trial work as well as biomarker development. We believe that our strategy of broadening our biomarker services offering continues to be a sound move even in view of somewhat mixed results so far for this fiscal year -- down 15% for the quarter, but up 4% for the six month period. The current market conditions may challenge us for a time and we have implemented measures to control costs including a reduction in force during the second quarter and other operating expense reductions. We believe we will be positioned appropriately as the market improves."
"We believe PBI's improved financial performance for the first half of Fiscal 2011 is encouraging. Nonetheless, we have made substantial adjustments to our current operating plan in view of soft margins and increased expense levels. We anticipate improvement in demand for our broad portfolio of specialty laboratory and biomarker services. We have identified the biomarker services area as the long-term growth driver in a market segment where demand is strong and there continue to be no dominant players in this area," concluded Helm.
For additional information, see Pacific Biomarkers' quarterly report filed with the SEC on Form 10-Q for the fiscal quarter ended December 31, 2010 and its annual report filed with the SEC on Form 10-K for the fiscal year ended June 30, 2010.
About Pacific Biomarkers, Inc.
Established in 1989, PBI provides biomarker laboratory services and contract research services to support pharmaceutical and diagnostic manufacturers conducting human clinical trial research. The Company provides expert services in the areas of cardiovascular and musculoskeletal diseases, diabetes, obesity, and nutrition. The PBI laboratory is accredited by the College of American Pathologists, New York State, and the Lipid Standardization Program. PBI's clients include many of the world's largest pharmaceutical, biotech, and diagnostic companies. PBI also provides clinical biomarker services focusing on the emerging field of biomarker assay development and testing. Services include validating and performing custom assays for novel clinical biomarkers, immunogenicity testing, mass spectrometry, and multiplex testing.
PBI is headquartered in Seattle, Washington, and its common stock trades on the OTC Bulletin Board under the symbol "PBMC."
For more information about PBI, visit the company's website at www.pacbio.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
This press release includes forward-looking statements including, but not limited to, the following: growth in revenues; results of business development activities; financial results; future growth; and growth and demand for our services, particularly our biomarker services. These forward-looking statements are subject to a number of risks and uncertainties that may cause actual results to differ materially from those described in the forward-looking statements. These risks include, but are not limited to, the following: the Company's ability to enter into contracts for its laboratory testing or biomarker services; client changes or early terminations of studies; the success of marketing and business development efforts, and competitive factors; the Company's ability to manage growth; and other risks and uncertainties set forth in periodic filings with the U.S. Securities and Exchange Commission (including Form 10-K for the year ended June 30, 2010).
PACIFIC BIOMARKERS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
December 31, June 30,
ASSETS 2010 2010
(unaudited)
------------- -------------
Current assets:
Cash and cash equivalents $ 1,113,143 $ 1,861,155
Short-term bank deposits 455,029 468,619
Accounts receivable, net 1,513,115 1,852,987
Other receivable, net 6,500 6,500
Inventory 232,105 239,863
Prepaid expenses and other assets 302,359 229,802
------------- -------------
Total current assets 3,622,251 4,658,926
Property and equipment, net 1,249,634 1,309,764
Total assets $ 4,871,885 $ 5,968,690
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 551,991 $ 605,944
Accrued liabilities 399,620 632,429
Advances from customers 470,333 408,455
Capital lease obligation - current portion 204,822 200,806
Secured note - current portion, net of
discount 860,068 1,015,603
------------- -------------
Total current liabilities 2,486,834 2,863,237
Capital lease obligations - long-term
portion 288,153 389,820
Secured note - long-term portion, net
of discount 2,491,353 2,676,969
------------- -------------
Total liabilities 5,266,340 5,930,026
------------- -------------
Commitments and contingencies - -
Stockholders' equity:
Common stock, $0.01 par value, 30,000,000
shares authorized, 16,909,501 shares
issued and outstanding at December 31,
2010, 16,669,856 shares issued and
outstanding at June 30, 2010 166,981 166,699
Additional paid-in-capital 27,841,204 27,723,024
Accumulated deficit (28,402,640) (27,851,059)
------------- -------------
Total stockholders' equity (deficit) (394,455) 38,664
Total liabilities and stockholders'
equity $ 4,871,885 $ 5,968,690
============= =============
PACIFIC BIOMARKERS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Three Months Ended Six Months Ended
December 31, December 31,
------------------------ ------------------------
2010 2009 2010 2009
----------- ----------- ----------- -----------
Revenues $ 2,532,069 $ 2,113,795 $ 5,385,602 $ 4,415,170
----------- ----------- ----------- -----------
Laboratory expenses
and cost of sales 1,515,574 1,380,457 3,194,383 2,774,157
----------- ----------- ----------- -----------
Gross profit 1,016,495 733,338 2,191,219 1,641,013
----------- ----------- ----------- -----------
Operating expenses:
Selling, general
and administrative 1,219,223 1,040,375 2,441,471 2,161,758
----------- ----------- ----------- -----------
Operating loss (202,728) (307,037) (250,252) (520,745)
----------- ----------- ----------- -----------
Other expense:
Interest expense (134,261) (138,851) (274,222) (191,951)
Amortization of
discount on debt (13,754) (12,132) (32,565) (18,090)
Other income 1,525 391 5,458 7
----------- ----------- ----------- -----------
Total other expense (146,490) (150,592) (301,329) (210,034)
Net loss before tax
expense (349,218) (457,629) (551,581) (730,779)
----------- ----------- ----------- -----------
Tax expense - - - -
Net loss $ (349,218) $ (457,629) $ (551,581) $ (730,779)
=========== =========== =========== ===========
Net loss per share $ (0.02) $ (0.03) $ (0.03) $ (0.04)
=========== =========== =========== ===========
Weighted average
common shares
outstanding, basic
and diluted: 16,909,501 16,711,096 16,909,501 18,141,744
=========== =========== =========== ===========
PACIFIC BIOMARKERS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
Six Months Ended
December 31,
----------------------------
2010 2009
------------- -------------
Cash flows from operating activities:
Net loss $ (551,581) $ (730,779)
Reconciliation of net loss to net cash
provided by (used in) operating
activities:
Depreciation and amortization 193,982 151,114
Amortization of discount on debt 32,565 18,090
Income on deposits 13,590 4,473
Compensation expense from restricted
shares and options 118,462 49,590
Changes in assets and liabilities:
Accounts receivable 339,872 1,063,480
Other receivable - 5,500
Inventory 7,758 (1,019)
Prepaid expenses and other assets (72,557) 71,140
Advances from customers 61,878 47,537
Accounts payable (53,953) (128,601)
Accrued liabilities (232,809) (282,844)
------------- -------------
Net cash provided by (used in)
operating activities (142,793) 267,681
------------- -------------
Cash flows from investing activities:
Purchases of capital equipment (133,853) (92,122)
Purchases of investments - (506,710)
------------- -------------
Net cash used in investing activities (133,853) (598,832)
------------- -------------
Cash flows from financing activities:
Payments on notes payable (373,715) -
Proceeds from loan - 4,000,000
Repurchases of common stock - (1,674,334)
Restricted stock transferred for employee
withholding tax liability - (65,614)
Payments on capital lease obligations (97,651) (30,283)
------------- -------------
Net cash provided by (used in)
financing activities (471,366) 2,229,769
------------- -------------
Net increase (decrease) in cash and cash
equivalents (748,012) 1,898,618
Cash and cash equivalents, beginning of
period 1,861,155 1,365,406
------------- -------------
Cash and cash equivalents, end of period $ 1,113,143 $ 3,264,024
============= =============
Supplemental Information:
Cash paid during the period for interest $ 210,967 $ 136,606
Cash paid during the period for income tax $ - $ -
PACIFIC BIOMARKERS, INC
220 W. Harrison Street Seattle, WA 98119
TEL. (206) 298-0068
FAX (206) 298-9838
For additional information, please contact:
Ron Helm
CEO
(206) 298-0068